NBR will reduce the level of minimum reserve requirements (RMO) to lead when the liquidity deficit becomes permanent and there will be no excess liquidity, said Governor Mugur Isărescu.
"Surplus and liquidity shortages are temporary. There are fluctuations up and down liquidity, which is quite normal. If these ups and downs were not normal, I would do something very special. But they are quite normal. If the liquidity deficit becomes permanent and it's not will be over-liquidity, we will reduce by one to two percent of the RMO reserve, which is now 8%. It is banks' money. We are slightly up to 8% above the European average of 2%, says Isarescu yesterday's press conference after the latest monetary policy session this year.
The NBR Board held yesterday the main interest rate of 2.5%, as well as the reserve requirement of RON and foreign currency at the 8% level.
The RMO for debt in the banks is 8%, the last discount is due in the spring of 2015. A new reduction of RMO would release the market at about 3-4 billion trillion, which increases liquidity on the interbank market, affecting ROBOR index adjustment.
At present, the central bank has relied on repo operations. The NBR resumed liquidity injections in August this year and carried out nine repo transactions so far, through which the central bank temporarily acquires government securities in the credit institution's portfolio and gives them liquidity in exchange.
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Article published in the printed edition of Ziarul Financier dated 07.11.2018